Chapter 3 Introduce PubSub as a communication method

3.1 Objectives

  • consider reasons why introducing a PubSub communication would be beneficial
  • implement the PubSub communication between the Streamer.Binance and the Naive.Trader(s)

3.2 Design

First, let’s look at the current situation:

We started with the Binance streamer calling the send_event/1 function on the Naive module. The Naive module then calls the trader process using the GenServer’s cast/2 function(via its registered name).

The next step in the process of extending our trading strategy will be to scale it to run multiple Naive.Trader processes in parallel. To be able to do that we will need to remove the option to register the trader process with a name(as only one process can be registered under a single name).

The second issue with that design was the fact that the Streamer needs to be aware of all processes that are interested in the streamed data and explicitly push that information to them.

To fix those issues we will invert the design and introduce a PubSub mechanism:

The streamer will broadcast trade events to the PubSub topic and whatever is interested in that data, can subscribe to the topic and it will receive the broadcasted messages. There’s no coupling between the Streamer and Naive app anymore.

We can now introduce multiple traders that will subscribe to the topic and they will receive messages from the PubSub:

Going even further down the line we can picture that system could consist of other processes interested in the streamed data. An example of those could be a process that will save all streamed information to the database to be utilized in backtesting later on:

3.3 Implementation

We will start by adding a Phoenix.PubSub library to both Streamer and Naive app(as both will be using it, Streamer app as a broadcaster and Naive app as a subscriber).

Scrolling down through its readme on GitHub we can see that we need to add :phoenix_pubsub to list of dependencies:

# /apps/streamer/mix.exs & /apps/naive/mix.exs
  defp deps do
    [
      ...
      {:phoenix_pubsub, "~> 2.0"},
      ...
    ]
  end

Remember to place it so the list will keep alphabetical order. The second step in the readme says that we need to add PubSub as a child of our app. We need to decide where we will put it, Streamer sounds like a good starting point. We will modify the /apps/streamer/lib/streamer/application.ex module by appending the PubSub to it:

# /apps/streamer/lib/streamer/application.ex
  def start(_type, _args) do
    children = [
      {
        Phoenix.PubSub,
        name: Streamer.PubSub, adapter_name: Phoenix.PubSub.PG2
      }
    ]
    ...
  end

We will add the :adapter_name option to instruct PubSub to use pg adapter, which will give us distributed process groups.

We will now modify the streamer to broadcast a message to PubSub topic instead of using the Naive module’s function:

# /apps/streamer/lib/streamer/binance.ex
  defp process_event(...) do
    ...
    Phoenix.PubSub.broadcast(
      Streamer.PubSub,
      "TRADE_EVENTS:#{trade_event.symbol}",
      trade_event
    )
  end

Inside the trader on init we need to subscribe to the “TRADE_EVENTS” PubSub channel:

# /apps/naive/lib/naive/trader.ex
  def init(...) do
    ...
    Phoenix.PubSub.subscribe(
      Streamer.PubSub,
      "TRADE_EVENTS:#{symbol}"
    )
    ...
  end

Next, we need to convert all handle_call callbacks to handle_info inside our Trader module as PubSub doesn’t use GenServer.cast/2 to send messages over to subscribers.

The final change will be to remove the send_event function from the Naive module as it’s no longer required.

Our update is now finished so we can start an iex session to see how it works.

First, we will start a streamer process that will broadcast messages to PubSub. Next, we will start trading on the same symbol. On init, the trader will subscribe to a PubSub channel and it will make a full trade cycle.

$ iex -S mix
...
iex(1)> Streamer.start_streaming("xrpusdt")
{:ok, #PID<0.483.0>}
iex(2)> Naive.Trader.start_link(%{symbol: "XRPUSDT", profit_interval: "-0.01"})
23:46:37.482 [info]  Initializing new trader for XRPUSDT
{:ok, #PID<0.474.0>}
23:46:55.179 [info]  Placing BUY order for XRPUSDT @ 0.29462000, quantity: 100
23:46:55.783 [info]  Buy order filled, placing SELL order for XRPUSDT @ 0.29225),
quantity: 100.00000000
23:46:56.029 [info]  Trade finished, trader will now exit

This shows that the new trader process successfully subscribed to the PubSub, received the broadcasted messages, placed buy/sell orders, and terminated after the full trade cycle finished.

[Note] Please remember to run the mix format to keep things nice and tidy.

Source code for this chapter can be found at Github